Arcapita powers Saudi Arabia’s industrial surge with a $500 million logistics fund. The company is seeking to elevate the Kingdom’s global logistics profile through strategic real estate investments.

Aracapita Capital, a Bahrain-based investment management firm that falls under the Arcapita Group, has closed $500 million KSA Logistics Fund III along with the collaboration of an unnamed sovereign wealth fund from the GCC region and other institutional investors. Previously, the investment management firm had already deployed substantial real estate assets across the manufacturing and warehousing sectors. This logistics fund aims to improve Saudi Arabia’s ambitions of becoming a global logistics hub. 

Arcapita Group Holdings Limited’s subsidiary, Arcapita Capital Company with the participation from an unnamed leading sovereign wealth fund from the GCC region along with other major institutional investors, closed the third Saudi Arabia’s Logistics Fund for SAR 1.8 billion ($500 million). In the coming days, the investment firm expects to set the plan in motion on a pipeline of further assets that are planted across strategic locations such as Riyadh, Jeddah, and the Eastern Province. In addition, the management firm will also go for a built-to-suit approach, whereby properties will be developed based on long-term off-take agreements with the tenants. 

Furthermore, the fund gives an idea of Arcaptia’s strategy of bringing the firm’s international expertise in industrial real estate to the Kingdom’s industrial sector and supporting its ambitions of becoming a global logistics hub. The Deputy Chief Executive Officer of Arcapita, Hisham Al Raee, said: “Today marks an important milestone in our strategic expansion in Saudi Arabia, the largest economy in the MENA region. We currently manage over SAR 3.8 billion ($1 billion) of industrial warehousing assets in KSA and the GCC region, and our investor base includes pension funds, sovereign wealth funds, and financial institutions. The industrial and logistics sectors are key components of the Kingdom’s Global Supply Chain Resilience Initiative, which aims to attract SAR 40 billion ($10.6 billion) in investments. We look forward to continuing to deploy our expertise in the industrial real estate sector to play a key role in transforming the Kingdom into a global logistics hub.”

Yousif Al Abdulla, Managing Director and Head of MENA Investment at Arcapita Group, also stated: “We expect Saudi Arabia’s industrial real estate market to experience substantial growth over the long term, driven by the significant and continued growth of e-commerce across the Kingdom and by strong government-led investment in infrastructure and the industrial sector. Arcapita Group’s portfolio strategy will leverage opportunities presented by the National Industrial Development and Logistics Program, as well as the Kingdom’s Vision 2030 plan.”

Since the investment management firm’s inception, the Group has managed over SAR 24.3 billion in industrial and logistics real estate transactions across the globe, which includes the investment of SAR 5.6 billion in the GCC region, over the 25 years. In addition to that, Arcapita Group has an extensive track record of investments in the Saudi Arabia region with nearly SAR 1.5 billion in investments over the past 10 years.